Well the straddle covers the bet both ways. The larger pay-off is on the downside with huge returns if GME tanks, but the 5.6 million in Call contracts with even marginal upside gains would offset the puts (the downside bet), the put contracts rapidly lose value if the price goes higher and vice versa.
It looks to me like a 12.375 million dollar downside bet with a 5.6mm insurance policy in call contracts to cover losses if it keeps going up.
But as far as institutional investors go 20 million is nothing, this is chump change, it could be a rope-a-dope to get people to buy puts contracts on the downside because they could sell those puts tomorrow as game stop stock rises.
Game Stop stock is "in play" but by it's own merits and technicals it should not be, so be careful.
In GME's favor are two things the financial media never wants to talk about:
The true short interest. It will cause the squeeze - it is inevitable. The documented SI in January was 226% - and they never closed the position - this is all per court transcripts of the civil suit against Interactive and RH. Since January, the squeeze has been delayed as they continued synthesizing more shares. (counterfeiting shares, creating a bigger squeeze.) The shorts couldn't unwind in January, and they really, really have dug a deeper hole for themselves in the last 10 months.
The NFT program, rumored to soon be unveiled (possibly this Friday). The hints being dropped about it is that the NFT is bringing something revolutionary to the market. A watershed moment.
These two aspects are rarely, if ever, talked about in financial news. When they are mentioned, the data is purposely skewed or distorted.
This is just my unprofessional opinion, but GME is going to squeeze like nothing anyone has ever seen, and I believe it was designed to do that, from the very beginning.
I am trying to learn... I tried to plot the profit potential using https://www.optionsprofitcalculator.com/calculator/straddle.html
I appears to indicate to my smooth brain that this trader is expecting price to swing pretty large pretty soon. Am I wrong?
https://ibb.co/hFKDM9j
Well the straddle covers the bet both ways. The larger pay-off is on the downside with huge returns if GME tanks, but the 5.6 million in Call contracts with even marginal upside gains would offset the puts (the downside bet), the put contracts rapidly lose value if the price goes higher and vice versa.
It looks to me like a 12.375 million dollar downside bet with a 5.6mm insurance policy in call contracts to cover losses if it keeps going up.
But as far as institutional investors go 20 million is nothing, this is chump change, it could be a rope-a-dope to get people to buy puts contracts on the downside because they could sell those puts tomorrow as game stop stock rises.
Game Stop stock is "in play" but by it's own merits and technicals it should not be, so be careful.
In GME's favor are two things the financial media never wants to talk about:
The true short interest. It will cause the squeeze - it is inevitable. The documented SI in January was 226% - and they never closed the position - this is all per court transcripts of the civil suit against Interactive and RH. Since January, the squeeze has been delayed as they continued synthesizing more shares. (counterfeiting shares, creating a bigger squeeze.) The shorts couldn't unwind in January, and they really, really have dug a deeper hole for themselves in the last 10 months.
The NFT program, rumored to soon be unveiled (possibly this Friday). The hints being dropped about it is that the NFT is bringing something revolutionary to the market. A watershed moment.
These two aspects are rarely, if ever, talked about in financial news. When they are mentioned, the data is purposely skewed or distorted.
This is just my unprofessional opinion, but GME is going to squeeze like nothing anyone has ever seen, and I believe it was designed to do that, from the very beginning.
So your unprofessional opinion would be to buy 5 or above tier "in the money" Call contracts and buy some popcorn and watch the show?
No it would not.
I personally bought long and hold in direct registration.
Every option contract is resulting in more synthetic shares being introduced. They are all FTD's. Not many real shares left at the DTCC.
Either way though - this is happening, and soon.
Everyone has to make the decision for themselves on what to do or not do.
I never listen to strangers in windowless vans, OR the internet.
No shortage of people getting burned badly buying GME contracts. Can't lose with some shares at a broker and some shares at Computershare.